Addressing members of the Southern India Mills' Association (SIMA) here, he called for a long-term policy in this regard as an export market could not be created overnight. Though it had been announced that the reduction would be available only till March 31, the bank should realise that exporters required more time to cultivate and win over importers and this process naturally took time, he added.

Referring to the severe recession faced by the textile industry, he said since the mills in Mumbai and Ahmedabad had not paid attention to modernisation and their owners continued to milch the mills they were forced to close down. He cautioned the mills in the south to pay more attention tomodernisation.

Agreeing with the mills' contention that "antiquated" labour laws like the one that mills should pay a minimum bonus of 8.9 per cent every year to the workers were threatening the very viability of the mills, Hegde expressed hope that the new labour laws in the offing would solve many of the problems. He said the country had not reached the desired growth rate on the export front since exports had not been given priority in the scheme of things all these years. A proper climate and infrastructural facilities could have enabled the nation to attain an export target of 100 billion dollars by now, he added.

"We have not yet crossed $ 35 billion due to various reasons such as multiple tax burden, lack of infrastructure, an unco-operative if not hostile bureaucratic set-up, particularly at the lower level, and antiquated labour laws which were the consequences of the country's experiment with phoney socialism.